Credit unions have an age problem…MoveCU.com wants to solve it.
If every time you walk into your local credit union, you think, “Wow, everyone here is older,” you aren’t wrong.
According to a recent survey by Trellance, the average age of credit union members is 47 years old. Their most loyal members (68%) are over 65.
So where are all the young people at?
And why aren’t they joining credit unions? What happened to that whole, “take down the big banks” mantra the millennials were touting a few years back? (We didn’t imagine that…that was a thing, right?!)
There are a couple of problems here that need addressing:
There is a HUGE lack of education around credit unions
When it comes to credit unions and youth, myths and misconceptions prevail.
- Two out of every five non-members think they can’t join a credit union.
- 13% of millennials think you have to pay to be a credit union member.
- 24.7% of millennials have “no idea how to describe one” when asked what a credit union was.
- 27.4% of millennials think credit unions are a special “club with members.
- 60% of millennials don’t know the benefit of getting an auto loan with a credit union.
The first point should probably be stated again for the credit unions in the back.
TWO out of FIVE non-members think they CAN’T JOIN a credit union. That’s 40%. That in and of itself is a huge problem.
But if you start digging further into the data, it’s just the beginning of a much bigger issue…
Referrals are dropping – and rapidly
Since their creation, credit unions have depended on referrals for new members. That’s basically how credit unions came to exist. However, it seems in recent years these referrals have been happening less and less often:
- 90% of members DO NOT encourage their children to join their credit union.
- 60% of credit union members’ children choose to bank at a different institution.
That’s a BIG BIG BIG problem.
Did we say big? Especially if you start considering how generational wealth transfers could impact credit unions as their membership continues to age. Let’s reword that: If grandma gives all her money to Tim when she passes, and Tim isn’t a part of the credit union, guess where that money goes? (You’re welcome big bank.) Now let’s consider MOST of credit union membership is grandma’s age.
Millennials and Gen Z are now the largest generational demographic
Unfortunately for credit unions, they’re taking their money…to the bank.
- Millennials are the largest driver of net new loan demand.
- Only one in five Millennials under 25 use credit unions as their primary financial institution.
- Only 10% of older Millennials (ages 25 – 34) use credit unions as their primary financial institution.
Part of the reason for the drop off? Technology.
Either credit unions don’t have it – or consumers don’t THINK they have it. The issue with that is:
- Up to 80% of smartphone-owning Gen Z and Millennials are using mobile banking.
- Only 42% of credit union members say they are using their credit union’s mobile app.
- 64% of banking members are using their institution’s mobile app.
- 44% of millennials bank with one of three “big banks” – researchers are saying mobile banking is one of the biggest factors.
After COVID-19, these numbers aren’t likely to get better
Since the COVID-19 pandemic hit, Americans are looking for more digital solutions.
- 85% of Americans say they will use digital tools to conduct all or some financial transactions post COVID-19.7.
- 75% of Millennials said they would switch their primary financial services organization for a better mobile app.
- 58% of Gen Z prefers to open a deposit account via desktop or mobile app. The same is true with 60% of Millennials.
If digital solutions are how younger generations like to bank, you can see why their preconceptions about credit union technology being “behind the times” is probably not going to be a positive contributor to the “getting younger people to join” issue.
Credit unions don’t have as much collective influence or clout as the big banks
Giant educational advertising campaigns aren’t really on the agenda for most credit unions. Though, collectively they could afford it, they generally like spending the majority of their advertising dollars on their own specific marketing needs. That objective doesn’t always leave a lot leftover to educate younger generations on the very basics of what credit unions are and how they are different from banks.
It isn’t all doom and gloom though…
MoveCU is moving in to change the game for credit unions.
The real issue is: We know the problem. How do credit unions solve it?
They add MoveCU as a loan lead generator.
A multi-award winning innovative credit union fintech (financial tech) company, MoveCU is moving in to change the game for credit unions nationwide.
MoveCU is succeeding with millennials and gen z where credit unions aren’t:
- 28% of MoveCU applicants are between 18 and 34 years old.
- 55% of MoveCU applicants are below the age of 44 years old.
MoveCU is offers a convenient and completely digital lending process:
While a lot of consumers like the idea of a credit union loan, the actual process of getting one can be cumbersome. First they have to find a credit union they qualify for. Then they need to figure out loan rates, compare them to other credit unions, read reviews…AND half are already halfway through the doors of the nearest big bank.
With MoveCU it’s easy. Type in your information, and we instantly connect you to low-rate lending options that you qualify for. No need to go to multiple sites, or look through tons of membership requirements and lending rate pages. We do all the work for you.
MoveCU is unique in ways that make a BIG difference:
- We ONLY offer credit union loans – No lending options from “big banks” or other lending institutions are available on our website.
- Our service benefits both consumers and credit unions equally – Consumers want the best loan rate they can get. Credit unions want more (qualifying) members and to inexpensively generate new loan leads. Both get exactly that from MoveCU.
- All screening, paperwork and approvals are done through our digital application process – At MoveCU, we take care of the entire approval, screening, and lending process from start to finish.
- We cater to a younger audience – Our current audience numbers aren’t by chance. We cater to the needs of a more digital-based audience’s needs, which tends to be the convenience-driven millennial and gen z market.
- CUNA July 2017
- CU Journal 2021 Survey
- Access Softek, Inc. 2020 Survey
- 2019 Morgan Stanley research
- 2016 FICO Study
- 2019 Cornerstone Advisors Survey
- Keybank 2020 Financial Resiliency Survey
- 2021 BAI Banking Outlook Special Report
- 2021 User Data - MoveCU